Gold drops to near $1200, still falling fast. Down 40% in the last 6 months. Gold speculators and retailers rake in the dough. Regular Joes conned into buying hyper inflated commodity get screwed, as always.

Gold drops to near $1200, still falling fast. Down 40% in the last 6 months. Gold speculators and retailers rake in the dough. Regular Joes conned into buying hyper inflated commodity get screwed, as always.

This is why I think the people who invest in gold are generally deficient where it counts.

It's not that gold is a bad investment, per se. It's that most of the people who invest in gold are doing so because of some irrational fear and as insurance during a time of a barter economy, presumably at some undetermined time in the future.

Forget about whether or not gold will have any actual worth in a true barter economy (I for one think it will be worthless, considering it has no real value other than it looks shiny).

In order to invest in gold as insurance against a collapsing economy, you have to be one of those people who believes it's inevitable. That means that until the economy actually collapses, you're going to keep buying, and you're never going to sell. Like you said, it's the speculators who are making the money, and they're doing it on the backs of people like baja, gaff and several others in this thread.

This is why I think the people who invest in gold are generally deficient where it counts.

It's not that gold is a bad investment, per se. It's that most of the people who invest in gold are doing so because of some irrational fear and as insurance during a time of a barter economy, presumably at some undetermined time in the future.

Forget about whether or not gold will have any actual worth in a true barter economy (I for one think it will be worthless, considering it has no real value other than it looks shiny).

In order to invest in gold as insurance against a collapsing economy, you have to be one of those people who believes it's inevitable. That means that until the economy actually collapses, you're going to keep buying, and you're never going to sell. Like you said, it's the speculators who are making the money, and they're doing it on the backs of people like baja, gaff and several others in this thread.

In a survivalist economy the guy with the aquaculture tanks in his back yard is better off than the guy with the Krugerrands in his safe.

Gold drops to near $1200, still falling fast. Down 40% in the last 6 months. Gold speculators and retailers rake in the dough. Regular Joes conned into buying hyper inflated commodity get screwed, as always.

Regular Joes selling their gold at selling cost are getting screwed. The average cost to mine gold over the last few years is about $1000 per oz. This includes some deeper mines recently that cost over $1500/oz. Those same gold speculators will take the regular Joe's lunch over the next few months.

It seems most people don't get it,you buy low sell high. That's why the fat cats are usually the only ones to benefit from buying gold. They can afford to buy it cheap & sit on it until the economy hits a pot hole when they then can dbl their money.

Regular Joes selling their gold at selling cost are getting screwed. The average cost to mine gold over the last few years is about $1000 per oz. This includes some deeper mines recently that cost over $1500/oz. Those same gold speculators will take the regular Joe's lunch over the next few months.

Even presuming you aren't FOS, the only reason mining gold @ $1500/oz is worthwhile is if the price is inflated to > $1500/oz. It does not mean that $1000-1500/oz is the cost of mining gold in general.

It's exactly parallel to the tar sands and oil. All the morons who claim extracting the tar sands will reduce the price of oil don't understand the basic economics of the situation. The only reason extracting oil out of tar sands is starting to make economic sense is because of the high cost of oil. If the cost of oil drops again, it won't be economically viable to extract oil from tar sands.

Same with gold or any other mineral that requires significant effort to extract. The price of the commodity determines what operations are economically viable, not the other way around.

It seems most people don't get it,you buy low sell high. That's why the fat cats are usually the only ones to benefit from buying gold. They can afford to buy it cheap & sit on it until the economy hits a pot hole when they then can dbl their money.

Gold is an 'emotional' investment, making it a lousy investment choice for most people. When it starts paying a dividend, I'll buy some.

Warren Buffet on gold.

Quote:

“Why do you think gold bugs get so irate? Because they really do come out. If you go on CNBC and say that bonds are kind of a poor investment, people don’t get mad at you. You don’t hear from the Treasury. You can knock almost any investment and nothing happens. But when you talk about gold it’s different. Of course that says something about their motivation for ownership. They want people to agree with them. They want everybody to get so scared they run to a cave with gold. Caves might be a better investment than gold. At least they’re not producing more caves all the time. So they want people to be as afraid as they are. Incidentally, they’re right to be afraid of paper money. Their basic premise that paper money around the world is going to be worth less and less over time is absolutely correct. They have the correct basic premise. They should run from paper money. But where they run to is the mistake.”

Even presuming you aren't FOS, the only reason mining gold @ $1500/oz is worthwhile is if the price is inflated to > $1500/oz. It does not mean that $1000-1500/oz is the cost of mining gold in general.

It's exactly parallel to the tar sands and oil. All the morons who claim extracting the tar sands will reduce the price of oil don't understand the basic economics of the situation. The only reason extracting oil out of tar sands is starting to make economic sense is because of the high cost of oil. If the cost of oil drops again, it won't be economically viable to extract oil from tar sands.

Same with gold or any other mineral that requires significant effort to extract. The price of the commodity determines what operations are economically viable, not the other way around.

Goldcorp costs are about average, and they're operating on razor thin margins in 2013.

The most expensive place to mine gold is in South Africa. They have mines that cost over $1500/oz. Obviously, they slowed down or stopped production. I googled an article written today that estimates that 60% of the South African industry is in loss-making territory at these prices.

The most expensive place to mine gold is in South Africa. They have mines that cost over $1500/oz. Obviously, they slowed down or stopped production. I googled an article written today that estimates that 60% of the South African industry is in loss-making territory at these prices.

The cheapest place to mine is in Nevada at $500/oz. But gold would be worth a lot more than cost if Nevada had the only mines in operation.

The average cost to mine gold you cite is quite silly. It includes the high cost mines in operation only because it's profitable to operate at high prices.

Like I said (and you have rebutted with nothing). The cost of gold is irrespective of it's cost to mine. The market price of gold is what determines which mining operations are viable, and which are not.

Brit evidently thinks the collapsed gold price is the result of market forces at work.

How then to explain why the demand for gold has never been higher. High demand should have driven up the price. Hmm...

This tells us the collapse has been engineered.

A friend thinks that the banksters are attempting to take control of various gold mines -- by driving them into chapter 11 -- or forcing them to close down -- or by making their stock so low they simply buy it up cheap.

In short -- it's a scam -- a rigged game.

This kind of manipulation of the market is illegal. Are we a nation of law? Evidently not -- when banksters can get away with this.

Brit evidently thinks the collapsed gold price is the result of market forces at work.

How then to explain why the demand for gold has never been higher. High demand should have driven up the price. Hmm...

This tells us the collapse has been engineered.

A friend thinks that the banksters are attempting to take control of various gold mines -- by driving them into chapter 11 -- or forcing them to close down -- or by making their stock so low they simply buy it up cheap.

In short -- it's a scam -- a rigged game.

This kind of manipulation of the market is illegal. Are we a nation of law? Evidently not -- when banksters can get away with this.

MHG

Gaffney, you have no idea what you're talking about. However, Buffet was talking about people like you.

He nailed it.

Quote:

They want everybody to get so scared they run to a cave with gold. Caves might be a better investment than gold. At least they’re not producing more caves all the time. So they want people to be as afraid as they are.

Note the only time the Fed bought gold was the last three years, massively increasing their purchases in the last two years.Not only that the chart shows the fed selling gold all the previous years on the chart.

The chart also shows gold purchases for investment is strong and steady.

Note the only time the Fed bought gold was the last three years, massively increasing their purchases in the last two years.Not only that the chart shows the fed selling gold all the previous years on the chart.

The chart also shows gold purchases for investment is strong and steady.

Note the only time the Fed bought gold was the last three years, massively increasing their purchases in the last two years.Not only that the chart shows the fed selling gold all the previous years on the chart.

The chart also shows gold purchases for investment is strong and steady.

It looks like the fed is trying to drive down the gold price.

Really?? Investors have been dumping gold and moving billions into equities.

Gold and conspiracy junkies go hand in hand. The plunge in gold prices is no mystery.

It's not the FEDS, it's the the idiot gold bugs, the doom and gloom crowd dumping gold as fast as they can, now that 'investors' are taking their profits.

Quote:

Why is gold plunging? The most important factor is that global inflation is falling, reducing gold’s value as a hedge against rising prices. Gold bugs who were betting on an outburst of inflation are scrambling to reverse their bets and exit their gold positions at any price.

Really?? Investors have been dumping gold and moving billions into equities.

Is the news not getting through to Baja?

Gold investment demand is down 50% y2y. ETF investors are dumping it like it's toxic. They rode the bubble, and cashed out, leaving all the chumps that bought hard and expensive to move physical gold in the lurch.

Note the only time the Fed bought gold was the last three years, massively increasing their purchases in the last two years.Not only that the chart shows the fed selling gold all the previous years on the chart.

The chart also shows gold purchases for investment is strong and steady.

It looks like the fed is trying to drive down the gold price.

Baja, where do you get this?? If the Fed were buying, gold would be increasing in value, not dropping.
The 'Central banks' in the chart are mostly eastern European, Turkey and Russian CBs replenishing their gold reserves. Typically, they are sellers, not buyers.

By the look of their timing, they screwed up. They were buying when gold was $1600+ an ounce.

Baja, where do you get this?? If the Fed were buying, gold would be increasing in value, not dropping.
The 'Central banks' in the chart are mostly eastern European, Turkey and Russian CBs replenishing their gold reserves. Typically, they are sellers, not buyers.

By the look of their timing, they screwed up. They were buying when gold was $1600+ an ounce.